I have; like most folks in the tech blogosphere, been following the growing mess that is surrounding the whole Microsoft – Yahoo purchase/merger/acquisition. While it seems that a lot of bloggers are cheering on the bold (?) move by Yahoo to turn down the $44Billion dollar offer that Microsoft put on the table Robert Scoble in his typical fashion thinks that Yahoo has made a mistake.

For the most part though I have let the whole thing slide by because as far as I am concerned the idea of Microsoft buying up Yahoo is borderline lunacy that only shows how wrapped up we have become in the almighty advertising dollar. It is as if software is no longer driving the computer industry other than a way to provide fresh fodder for all those ad networks out there.

The other thing that really concerned me was the inevitable problems that would arise when you go about meshing two totally divergent corporate philosophies and workforces. For that I was waiting for Mini-Microsoft to have his say because I couldn’t see an event like this go by without his thoughts on the whole thing.

And not being one to fail M-M today posted his look at what is going on. While he does talk a bit about the whole advertising angle he also mentions his confusion over what was said by Ballmer in the past and what is being said now about buying Yahoo:

I was on the internal Microsoftie bandwagon that Steve Ballmer was steering not too long ago that an acquisition of Yahoo! didn’t make sense for Microsoft. So when the unsolicited offer went through, I was like a whole bunch of other confused senior people looking around trying to figure out what changed and why this suddenly was the right thing to do and to bet the company on.

As both hoped for and expected was his take on the hit that Microsoft would take trying to absorb (save the Borg jokes – they were old days after first said) 14,000 or so new employees. While he points out that even with the addition of all these new people the purchase of Yahoo isn’t bringing anything to the table to correct screwed up offerings by either company

Microsoft absorbing Yahoo! doesn’t make sense to me given the extreme overlap in offerings that neither Microsoft nor Yahoo! have been terribly effective at. How many success stories have there been lately at Yahoo!? I like their portal. I use their search on occasion (only when Live Search and Google give me disappointing results). And their acquisition of flickr was really good for them, along with not screwing flickr up (and flickr users, you gotta know Microsoft would be pretty hands-off of flickr, other than probably putting a Live ID sign-in bar or such on there).

Additionally he raises a point that I haven’t seen mentioned anywhere else. That being that in the divisions where the two companies overlap the Microsoft divisions shouldn’t be feeling to safe and secure because as he says those folks are under just as much scrutiny as the Yahoo offerings

And the MSN, search, and ads folk at Microsoft certainly shouldn’t be too proud right now, because you guys are under as much scrutiny as Yahoo!. Why are we proposing blowing $22,000,000,000USD in cash and going into debt? Because Yahoo! has something done right – relative to us, according to our leadership – that you haven’t been able to do. Is there a Microsoft online-services leadership shake-up coming? One can hope. The fact that we’ve initiated this acquisition, for whatever reason, means that the people in charge haven’t been able to deliver and are not on a path to deliver. Accountability?

Personally I think Microsoft should walk – if not run – away from the deal now that they have the chance – take that money that was on the table and really fix the in-house problems they have. If that means a massive shake up (firings etc) in those areas that they hoped the Yahoo deal would fix then get to it. Adding to one’s headache by buying a company that is flailing about looking for an identity in a sea of peanut butter isn’t going to fix your problems.

As it stands this deal is nothing more than Ballmer’s swan song for his entry into the computer history books but it is a swan song that could turn into an albatross cry around the neck of a company that is having its own identity problems.

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All evening I have being trying to come to grips with this whole Microsoft, Yahoo and Google thing. I’ve been reading and rereading the puff type posts and the equally well thought out posts on the events of the last couple of days. Everyone from MG Siegler with his twoexcellent posts on the matter, to Paul O’Flaherty who thinks Google is reacting out of fear and then to the typical Duncan Riley and Michael Arrington pieces on TechCrunch.

As interesting as all the posts I have read might be and as much as I might have learned bits and pieces from the different view points I am still left with one question. What the frak is the point of this deal. It makes absolutely no sense what so ever – none – nada. I don’t care what the spin is that Microsoft is trying to put around the whole deal. But then neither do I believe the crap that Google is spewing as to why this is a bad deal. The fact is the more they open their collective mouth the more they are beginning to sound like Sun, Netscape and a bunch of other companies from years ago that went crying to the government over some silly piece of software called a browser.

Let’s look at the players in this pending fiasco for a minute and try and make some sense of this. First of all we have the unwilling bride to be Yahoo who is looking more like a peanut butter sandwich that has fallen face down onto the floor and no matter how you pick it up there’s gonna be mess. Yahoo have become nothing more that a disparate collection of services that have the company spread all over the place. Yahoo seems to have become nothing more than a spaghetti throwing company and nothing is sticking long enough to form anything around.

As for Microsoft – well someone please take the crack pipe away from Ballmer and the sooner the better. Microsoft is already having enough of an identity crisis what with MSN this and Live that. This isn’t even taking into account the mess that the whole operating system division is in and now they are wanting to bring this whole SaaS stuff into the mix. At this point Google might be the 1,000 pound gorilla of the Internet but Microsoft is quickly beginning to resemble a 10,000 pound chicken with its head cut off – it doesn’t know which direction it wants to go.

As much as Microsoft might want to wish it was an Internet company it is nowhere near to being one – especially on the scale of Google, and no amount of billions is going to buy its way onto that dance card. So the idea of buying Yahoo as its entry fee into the Internet world is nonsensical to say the least. The very idea of having to mesh two totally different mind sets to operate as one huge entity should be enough to make the most sane man want to run and hide in a corner somewhere – if he doesn’t go screaming mad first.

Then we have Google circling the whole thing and watching for any opportunity to throw in a monkey wrench where ever it can. While Google might not have the resources themselves to do a deal against Microsoft it will be doing everything it can to make the process as difficult as possible. The last thing that Google wants is another player with deeper pockets playing in the sandbox of information that they have considered their exclusive property for so long.

Personally I can only think of one reason why this deal is going ahead and that is Steve Ballmer. To me this is his last great hurrah and he doesn’t care what the common wisdom is saying about how bad this deal could turn out to be. Ballmer wants his place in history and since Bill Gates has taken the all important places in history Ballmer is having to settle for second best.

Now whether that second best will be the successful purchase and meshing of two giant corporations or whether it will be the decline of the worlds greatest corporation into a morass of meaninglessness – well only history will tell us.

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In a move sure to spice up the lives of weekend pundits and enrich the wallets of more than a few Yahoo! stockholders, the story of a possible *cough* merger *cough* between it and Microsoft has hit the b’sphere.

So now that the stock exchanges are closed and wallets around the world are little fatter one wonders that other than a way for some folks to make some weekend spending cash just how realistic such a buyout would have been. After all other than securing a place in the corporate history books as the largest amount paid for acquiring a corporate name there is a lot that point to this as being a difficult purchase.

As pointed out in the article on WSJ-online (behind subscriber wall – so hat tip to Rough Type for the quote) there is a fairly big and fundamental problem with such an acquisition – the founders of Yahoo!

Top Yahoo executives could be a big obstacle to any deal. Co-founder Jerry Yang, for one, has a reputation for disliking Microsoft and avoids using Microsoft products, says one person familiar with the matter. Top Yahoo staff might leave if Microsoft acquired the company and triggered a vesting of their Yahoo options.

Now supposing that this hurdle was overcome does it make sense for either company to seriously entertain merger talks? On the one hand Microsoft would get a chance to flex it financial muscles; reminding everyone in the process of how much richer they are than Google, and it would give Yahoo! a chance to retire from the game as very wealthy players. On the other hand the inherent problems of trying to mesh two such huge workforces and ideologies are immense.

On top of this is that while the dollar amount of $50 Billion is being batted about as the price of having the party no-one appears to take into the additional costs that Microsoft would incur with such a move. Given that Yahoo! is a portal slash search engine slash advertising platform Microsoft would be looking at what to do with their portal (MSN), search engine (Live.com) and advertising platform (AdCenter) and the billions that they have poured into them all.

Unless Microsoft is willing to make some really hard decisions about cutting off their own properties at the knees after spending billions on them in order to integrate Yahoo! services I don’t ever see such a merger being anymore than rumors to enliven up a boring weekend news cycle.